Salary Negotiation: Separating Fact from Fiction

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September 22, 2013

Negotiating salary is an incredibly complex and emotional endeavor. And as such, it becomes a personal and charged issue that all too often results in misinformation.

An earlier survey this year showed 41% of people didn't negotiate salary for the job they currently hold. So in an attempt to figure out what's true and what isn't regarding salary negotiation, we sent out three new surveys filled out by more than 1,000 employees and employers. The goal was to decipher whether people negotiate, why there's a stigma attached to negotiating, whether employees believe they'll face negative repercussions when asking for more money, and whether employers actually get upset when employees advocate for themselves.

If you're thinking about asking for a raise but you have reservations, this is a must-read article with some figures that reveal some truly useful and eye-opening information on separating negotiation fact from fiction.

The first thing anyone asking for a salary increase should think about is why they're asking for it.

Most people probably think money is the main motivator. After all, people are asking for more of it so it stands to reason money would top the list. But they'd be wrong. Of the people who responded to our survey 37% chose money as the main reason, but that was topped by the 39% who said they want a raise because they've worked hard and want to feel appreciated.

Being underpaid and not being recognized for hard work or added job responsibilities are good reason to ask for a raise. But there are other reasons people fall back on that aren't as viable, and some of our respondents fit into those categories. For instance, 10% of people said they want a raise because of a personal situation (divorce, desire to buy a house, having a child, etc), and another 10% said they want a raise solely because they've been at the company for a certain amount of time.

Before you ask for more money, take a moment to make sure you're asking for the right reasons.

In prior surveys we established that people generally dread salary negotiations. Earlier this year, 59% of American workers we surveyed said they get apprehensive when it comes to negotiating salary. So it should come as no surprise what people answered when we asked them why they're scared to negotiate.

The overwhelming top response was a basic emotion we've all faced: fear of rejection. Fear of being told no topped the list with 43% of respondents saying they're scared of being rejected and feeling like they're not good enough. Fifteen percent said their stingy bosses/company are what's holding them back, with another 15% fearing they'd be fired for asking for more money. An additional 13% said they didn't fear getting fired, but were wary of other kinds of lingering retribution following a raise request gone bad.

Poor company performance (10%) and the bad economy (4%) were the two other issues respondents listed.

We surveyed employees and employers separately, and found there's a disconnect between what both sides think.

Among employees, 38% of those surveyed think companies will harbor resentment or be offended by the decision to negotiate either a job offer or a pay raise. But when asked about their personal experiences, only 4% claimed they were fired or demoted after asking for a raise, and just 19% said they lost a job offer during the interview stage when they decided to negotiate for more money.

But on the other side of the negotiating table, 73% of employers agreed they are not offended when people negotiate. Furthermore, a whopping 84% said they always expect job applicants to negotiate salary during the interview stage. But most importantly, 87% said they've never rescinded a job offer following negotiations during the interview, and no employers -- that's zero percent -- reported demoting or firing an existing employee simply for asking for a raise.

Deciding to ask for a raise is one thing, but how much should you ask for and more important, what's the minimum you should accept? We asked our readers about their most recent experiences with raise requests and the subsequent results.

The good news is 58% of respondents received a raise so far in 2013. An additional 18% last received a raise in 2012, 12% in 2011, 3% in 2010, and 8% of people said they last received a raise in 2009 or before. On average, people requested a 16% raise, but only received 9%.

The average dollar amount of our respondents' raises is $3,334.

The good news for employees is that 69% reported doing research prior to asking for a raise. But that's where the good news ends.

One-third (33%) of people don't know at what time of year their company evaluates salaries. Almost half -- 46% -- are not at all familiar with their company's compensation policy. Forty percent of respondents said they believe they're required to disclose their salary requirements/current salaries during the job interview. Also, one-quarter (25%) of people don't even realize they're able to negotiate things other than base pay.

And 56% of people believe benchmark salary information (such as the data offered by Salary.com) is difficult to find. This is the root of the problem because if you haven't visited a site like ours to find out what your job is worth, you lack the foundation required for a successful salary negotiation.

That's probably why 59% of respondents said they are unprepared for their next negotiation.

So the bottom line is people are afraid to negotiate. But as this survey clearly shows, there is little chance of losing a job offer or getting fired just because you asked for more money, and employers EXPECT you to negotiate. So what are you waiting for?

Salary.com has completely revamped the Personal Salary Report, which is the perfect tool not only for finding out what your job pays, but also provides negotiation tips and even practice dialogues for the negotiation itself.

If you don't value yourself then no one else will, so take stock of your situation and start negotiating today. The worst they can say is no.